12 ms·

New bill ensures Jailtime for CEOs that lie

93 points by elsewhen 7y ago

kerkeslager 7y ago
Good. In a more general sense, we as a society need to take a long, hard look at limited liability. We cannot call for more personal responsibility in society with one hand while with the other hand letting malicious decision-makers walk away with their personal fortunes while workers and shareholders take on the cost of their actions. People need to be held accountable for their actions, and this is especially true for people in positions of power whose actions can affect millions of people.
- leetcrew 7y ago
  on the flip side, limited liability allows smaller players to enter the market without necessarily risking their entire life savings.
  - jeiro0 7y ago
    On the flip side it takes their skin out of the game. This is some helicopter parenting nonsense. I want to play too but not get hurt. If one wants to be a service provider, in a free market, reliant on customers who in turn rely on them, shoulder all the risk. On the flip side other nations use universal social services to insure the general public if cushioned from complete failure. Anyone getting into business should really feel the burden. And big corp leadership should feel an even bigger burden for being too big to fail. They want to be that big they should be ready for a hard fall. I don’t owe political deference to corporate. They get my time and that’s good enough.
  - kerkeslager 7y ago
    So maybe the "long hard look at limited liability" I suggested concludes that limited liability applies only to small players entering the market. Nobody is confused about why limited liability exists, so I don't think it needs to be brought up every time someone points out the problems with it. It generally comes across as just trying to shut down the conversation, and refuse to admit there are very large downsides to limited liability.
    - leetcrew 7y ago
      what "very large downsides” are you talking about? the possibility that a company might be unable to repay a debt? do you also think we need to take a long hard look at bankruptcy? to me, the fact that I can hold a few thousand dollars in stocks without risking everything I own seems pretty good. I'm not sure how you could change it in a way that wouldn't shift the balance of power even more towards the well-capitalized.
      - kerkeslager 7y ago
        Ideally, limited liability wouldn't apply to people making decisions for the company: if a CEO decides, for example, not to recall deadly exploding cars because of a cost/revenue analysis, the CEO's 401k should not be off limits as a source of funds for a settlement against the company. I don't know why you assume you benefit from this not being the case: when Ford was sued for the Pinto, shareholders of Ford lost money which they wouldn't have lost if the decision makers had paid more of the settlement. One possible way to regulate this is related to voting and non-voting shares. If you want to invest in a company without taking on liability, you can invest in non-voting shares--since you can't make any decisions for the company, you can't be held liable if the company decides to do something wrong. But you shouldn't be able to take part in the decision making of a company without also taking responsibility if you decide to do something wrong.
  - ken 7y ago
    That may be true, but I see it in practice being used by CEOs whose annual salary is far bigger than my life savings, and who still walk away with Golden Parachutes. If the goal is specifically to assist startups, then let's find some way to codify that. It sounds like one of those cases of unintended consequences. Is it trying to help out the little guy? It sure looks like it's helping the rich stay rich.
    - leetcrew 7y ago
      in general, employees are not held financially responsible for mistakes they make at work unless they are being criminally negligent/malicious. a CEO is just a very well paid employee. unless I'm mistaken, limited liability is about what owners of a company are liable for. the goal of limited liability is not specifically to help startups, it's a common law concept that predates "startups" by hundreds of years. I would argue that it helps the little guy much more than the extremely wealthy. I personally could not invest at all if I couldn't limit my losses to the amount of money I put in. people with millions of dollars can take on a lot more risk without becoming homeless if one or two holdings goes belly-up.
      - kerkeslager 7y ago
        There's a pretty big difference between "My holdings went belly up because our process wasn't efficient enough" and "My holdings went belly up because I was caught giving cancer to kids". Limited liability may be intended to protect in the former case, but it also protects in the latter case. Part of the difficulty here is that ownership confers some power to shareholders (the ability to vote in some corporate matters) but doesn't confer any responsibility for those decisions. For the average investor, this is a good thing: I don't have time to vote in every shareholder election I hold the right to vote in, so it doesn't make sense to hold me liable for elections I didn't vote in. A possible solution here is non-voting shares. Limited liability could easily apply only to those holding non-voting shares, and people could have the ability to convert voting shares into non-voting shares if they don't intend to vote in shareholder elections.
- c3534l 7y ago
  I'm not sure you understand what limited liability means. Limited liability doesn't mean that the CEO can't be put in prison or Equifax liquidated. It means that after Equifax is liquidated, if there's still debts to be paid, I can't go into a private individuals 401(k) plan, see that they held stock in Equifax, then demand they empty their savings account to pay the debts for “their" company that they theoretically "own" in the form of stock. Limited liability doesn't mean corporations don't have to follow the law or can't be sued.
sarcasmatwork 7y ago
This might be an issue with 1A , but we shall see. It's about accountability imho. From CEO's to our elected leaders to law enforcement to celebrities. This is very generalized, but there is a huge lack of people being held accountable for their actions and decisions in this country. It's always someone else. I.E I think here, Jussie Smollett is a good recent example. The Equifax hack for example is an example of where the CEO failed. Easy fix, and could have been addressed but it was not. Equifax should not exist imho. They are in the business to keep our data private, and they clearly failed. Why do they get to continue to operate as nothing happened? They exposed millions of users private and confidential info, and all we get is credit reporting, and some of us get maybe a few dollars. sigh
- maerF0x0 7y ago
  > This might be an issue with 1A , but we shall see. This took me a few minutes to figure out. For others, I believe 1A refers to the constitution: Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances
  - sarcasmatwork 7y ago
    I apologize here, should have been more clear. https://www.law.cornell.edu/constitution/first_amendment https://www.law.cornell.edu/constitution/first_amendment This explains how lying is not protected in some cases, http://law2.umkc.edu/faculty/projects/fTrials/conlaw/lying.html http://law2.umkc.edu/faculty/projects/fTrials/conlaw/lying.h... or this https://www.theatlantic.com/politics/archive/2016/08/does-the-first-amendment-protect-deliberate-lies/496004/ https://www.theatlantic.com/politics/archive/2016/08/does-th...
- awinder 7y ago
  False statement of fact is not protected free speech, and has a long history of case law. So I'm not sure about hand-wringing over the constitutional impacts is really a serious concern.
tossAfterUsing 7y ago
Would be neat if we could get one of these for politicians that lie!
- lawn 7y ago
  Maybe start with the president?
  - williesleg 7y ago
    I agree, Obama should be in jail.
  - knorthfield 7y ago
    How would anyone become President?! /joke
  - throwaway_law 7y ago
    Read my lips: no new Taxes - Bush Sr. I did not have sexual relations with that woman - Clinton We found the weapons of mass destruction. - G.W. Bush If you like your healthcare plan, you can keep it. - Obama
    - pwinnski 7y ago
      This highlights the issue with criminalizing "lying," because these are not all the same. George H.W. Bush broke a promise, which is not (always) lying. Bill Clinton lied. George W. Bush, it's still not clear, but more likely lying than not. Barack Obama made a promise it turned out was out of his control to keep. The only one of the four we can say for certain lied is Clinton. And, of course, the current president.
      - munificent 7y ago
        Clinton's statement hinges on your definition of "sexual relations". For many, that means "any kind of sexual activity". I grew up in the South and there I understood it to mean good old p-in-v intercourse. If you got to third base with someone (oral) and a friend asked you if you had "sexual relations", you would honestly answer "no". I believe this strict definition comes from being a highly Christian culture where certain sex acts are proscribed and others aren't. "Sexual relations" is really defined as "the sex stuff the Bible says you can't do outside of marriage." Of course, at a high level, Clinton was very clearly trying to obscure the facts of his relationship with Lewinsky, but whether or not that sentence was literally a lie depends on the definition of the words in the sentence and there is a reasonable interpretation (Clinton himself is from the South) under which it is factually true.
tzm 7y ago
Personally, I think Andrew Yang has a bold position for data privacy that I hope Congress will embrace. Data as a property right: https://www.yang2020.com/policies/data-property-right/ https://www.yang2020.com/policies/data-property-right/
- deleted 7y ago
  [deleted]
- adolph 7y ago
  Data generated by each individual needs to be owned by them, with certain rights conveyed that will allow them to know how it’s used and protect it. If I were to set up an device that associated different electromagnetic spectrum emissions, would that data belong to me or to the people who emitted it?
williesleg 7y ago
Woo hoo! Let the witch Hunt begin! Like all good laws, the biggest offenders will not be affected.
donretag 7y ago
I rather they start with the financial companies. How many bankers were even charged after 2008? Rhetorical question of course.
- ceejayoz 7y ago
  It's a pity we didn't take a page from Iceland. https://www.bloomberg.com/news/features/2016-03-31/welcome-to-iceland-where-bad-bankers-go-to-prison https://www.bloomberg.com/news/features/2016-03-31/welcome-t...
tibbon 7y ago
Good. I find it unlikely to pass, but I'd like it to pass. If a CEO says publicly, "Our product is safe and good for the public, and there should be no concern" and it turns out they knew their product was actively harmful, or that they were marketing it in harmful ways (see: cigarettes, opiates) then they were willfully misleading the public and jail-time should be a very real possibility.
- LoSboccacc 7y ago
  I agree plenty times the command chain was let scot free from scandals because of the diluted liability on the corporate actions as whole and the limited personal responsibility granted by hiding behind a corporation, something personal to pierce the corporate veil is needed at this point in time as correction to the rampant abuse from execs
BrandonMarc 7y ago
Yeah, that's a bill that will never see passage.
cabaalis 7y ago
I was initially sceptical, because lying is generally not illegal. CEOs are people, and people have first amendment rights. However, it seems it's narrowly classifying the act of hiding what you do with personal data as criminal fraud, and I'm on board with that idea.
dang 7y ago
Bill proposals rarely count as on topic for HN. Most bills never go anywhere.
- disgruntledphd2 7y ago
  The content of this bill seems like it would be pretty important for HN, though.
  - deleted 7y ago
    [deleted]
deleted 7y ago
[deleted]
ficklepickle 7y ago
What's with the title? I thought Jailtime might be a new apple product. It should be "jail time".

93 points by elsewhen 7y ago

Good. In a more general sense, we as a society need to take a long, hard look at limited liability. We cannot call for more personal responsibility in society with one hand while with the other hand letting malicious decision-makers walk away with their personal fortunes while workers and shareholders take on the cost of their actions. People need to be held accountable for their actions, and this is especially true for people in positions of power whose actions can affect millions of people.

leetcrew 7y ago
on the flip side, limited liability allows smaller players to enter the market without necessarily risking their entire life savings.
- jeiro0 7y ago
  On the flip side it takes their skin out of the game. This is some helicopter parenting nonsense. I want to play too but not get hurt. If one wants to be a service provider, in a free market, reliant on customers who in turn rely on them, shoulder all the risk. On the flip side other nations use universal social services to insure the general public if cushioned from complete failure. Anyone getting into business should really feel the burden. And big corp leadership should feel an even bigger burden for being too big to fail. They want to be that big they should be ready for a hard fall. I don’t owe political deference to corporate. They get my time and that’s good enough.
- kerkeslager 7y ago
  So maybe the "long hard look at limited liability" I suggested concludes that limited liability applies only to small players entering the market. Nobody is confused about why limited liability exists, so I don't think it needs to be brought up every time someone points out the problems with it. It generally comes across as just trying to shut down the conversation, and refuse to admit there are very large downsides to limited liability.
  - leetcrew 7y ago
    what "very large downsides” are you talking about? the possibility that a company might be unable to repay a debt? do you also think we need to take a long hard look at bankruptcy? to me, the fact that I can hold a few thousand dollars in stocks without risking everything I own seems pretty good. I'm not sure how you could change it in a way that wouldn't shift the balance of power even more towards the well-capitalized.
    - kerkeslager 7y ago
      Ideally, limited liability wouldn't apply to people making decisions for the company: if a CEO decides, for example, not to recall deadly exploding cars because of a cost/revenue analysis, the CEO's 401k should not be off limits as a source of funds for a settlement against the company. I don't know why you assume you benefit from this not being the case: when Ford was sued for the Pinto, shareholders of Ford lost money which they wouldn't have lost if the decision makers had paid more of the settlement. One possible way to regulate this is related to voting and non-voting shares. If you want to invest in a company without taking on liability, you can invest in non-voting shares--since you can't make any decisions for the company, you can't be held liable if the company decides to do something wrong. But you shouldn't be able to take part in the decision making of a company without also taking responsibility if you decide to do something wrong.
- ken 7y ago
  That may be true, but I see it in practice being used by CEOs whose annual salary is far bigger than my life savings, and who still walk away with Golden Parachutes. If the goal is specifically to assist startups, then let's find some way to codify that. It sounds like one of those cases of unintended consequences. Is it trying to help out the little guy? It sure looks like it's helping the rich stay rich.
  - leetcrew 7y ago
    in general, employees are not held financially responsible for mistakes they make at work unless they are being criminally negligent/malicious. a CEO is just a very well paid employee. unless I'm mistaken, limited liability is about what owners of a company are liable for. the goal of limited liability is not specifically to help startups, it's a common law concept that predates "startups" by hundreds of years. I would argue that it helps the little guy much more than the extremely wealthy. I personally could not invest at all if I couldn't limit my losses to the amount of money I put in. people with millions of dollars can take on a lot more risk without becoming homeless if one or two holdings goes belly-up.
    - kerkeslager 7y ago
      There's a pretty big difference between "My holdings went belly up because our process wasn't efficient enough" and "My holdings went belly up because I was caught giving cancer to kids". Limited liability may be intended to protect in the former case, but it also protects in the latter case. Part of the difficulty here is that ownership confers some power to shareholders (the ability to vote in some corporate matters) but doesn't confer any responsibility for those decisions. For the average investor, this is a good thing: I don't have time to vote in every shareholder election I hold the right to vote in, so it doesn't make sense to hold me liable for elections I didn't vote in. A possible solution here is non-voting shares. Limited liability could easily apply only to those holding non-voting shares, and people could have the ability to convert voting shares into non-voting shares if they don't intend to vote in shareholder elections.
c3534l 7y ago
I'm not sure you understand what limited liability means. Limited liability doesn't mean that the CEO can't be put in prison or Equifax liquidated. It means that after Equifax is liquidated, if there's still debts to be paid, I can't go into a private individuals 401(k) plan, see that they held stock in Equifax, then demand they empty their savings account to pay the debts for “their" company that they theoretically "own" in the form of stock. Limited liability doesn't mean corporations don't have to follow the law or can't be sued.

sarcasmatwork 7y ago

This might be an issue with 1A , but we shall see. It's about accountability imho. From CEO's to our elected leaders to law enforcement to celebrities. This is very generalized, but there is a huge lack of people being held accountable for their actions and decisions in this country. It's always someone else. I.E I think here, Jussie Smollett is a good recent example. The Equifax hack for example is an example of where the CEO failed. Easy fix, and could have been addressed but it was not. Equifax should not exist imho. They are in the business to keep our data private, and they clearly failed. Why do they get to continue to operate as nothing happened? They exposed millions of users private and confidential info, and all we get is credit reporting, and some of us get maybe a few dollars. sigh

maerF0x0 7y ago
> This might be an issue with 1A , but we shall see. This took me a few minutes to figure out. For others, I believe 1A refers to the constitution: Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances
- sarcasmatwork 7y ago
  I apologize here, should have been more clear. https://www.law.cornell.edu/constitution/first_amendment https://www.law.cornell.edu/constitution/first_amendment This explains how lying is not protected in some cases, http://law2.umkc.edu/faculty/projects/fTrials/conlaw/lying.html http://law2.umkc.edu/faculty/projects/fTrials/conlaw/lying.h... or this https://www.theatlantic.com/politics/archive/2016/08/does-the-first-amendment-protect-deliberate-lies/496004/ https://www.theatlantic.com/politics/archive/2016/08/does-th...
awinder 7y ago
False statement of fact is not protected free speech, and has a long history of case law. So I'm not sure about hand-wringing over the constitutional impacts is really a serious concern.

tossAfterUsing 7y ago

Would be neat if we could get one of these for politicians that lie!

lawn 7y ago
Maybe start with the president?
- williesleg 7y ago
  I agree, Obama should be in jail.
- knorthfield 7y ago
  How would anyone become President?! /joke
- throwaway_law 7y ago
  Read my lips: no new Taxes - Bush Sr. I did not have sexual relations with that woman - Clinton We found the weapons of mass destruction. - G.W. Bush If you like your healthcare plan, you can keep it. - Obama
  - pwinnski 7y ago
    This highlights the issue with criminalizing "lying," because these are not all the same. George H.W. Bush broke a promise, which is not (always) lying. Bill Clinton lied. George W. Bush, it's still not clear, but more likely lying than not. Barack Obama made a promise it turned out was out of his control to keep. The only one of the four we can say for certain lied is Clinton. And, of course, the current president.
    - munificent 7y ago
      Clinton's statement hinges on your definition of "sexual relations". For many, that means "any kind of sexual activity". I grew up in the South and there I understood it to mean good old p-in-v intercourse. If you got to third base with someone (oral) and a friend asked you if you had "sexual relations", you would honestly answer "no". I believe this strict definition comes from being a highly Christian culture where certain sex acts are proscribed and others aren't. "Sexual relations" is really defined as "the sex stuff the Bible says you can't do outside of marriage." Of course, at a high level, Clinton was very clearly trying to obscure the facts of his relationship with Lewinsky, but whether or not that sentence was literally a lie depends on the definition of the words in the sentence and there is a reasonable interpretation (Clinton himself is from the South) under which it is factually true.

tzm 7y ago

Personally, I think Andrew Yang has a bold position for data privacy that I hope Congress will embrace. Data as a property right: https://www.yang2020.com/policies/data-property-right/ https://www.yang2020.com/policies/data-property-right/

deleted 7y ago
[deleted]
adolph 7y ago
Data generated by each individual needs to be owned by them, with certain rights conveyed that will allow them to know how it’s used and protect it. If I were to set up an device that associated different electromagnetic spectrum emissions, would that data belong to me or to the people who emitted it?

williesleg 7y ago

Woo hoo! Let the witch Hunt begin! Like all good laws, the biggest offenders will not be affected.

donretag 7y ago

I rather they start with the financial companies. How many bankers were even charged after 2008? Rhetorical question of course.

ceejayoz 7y ago
It's a pity we didn't take a page from Iceland. https://www.bloomberg.com/news/features/2016-03-31/welcome-to-iceland-where-bad-bankers-go-to-prison https://www.bloomberg.com/news/features/2016-03-31/welcome-t...

tibbon 7y ago

Good. I find it unlikely to pass, but I'd like it to pass. If a CEO says publicly, "Our product is safe and good for the public, and there should be no concern" and it turns out they knew their product was actively harmful, or that they were marketing it in harmful ways (see: cigarettes, opiates) then they were willfully misleading the public and jail-time should be a very real possibility.

LoSboccacc 7y ago
I agree plenty times the command chain was let scot free from scandals because of the diluted liability on the corporate actions as whole and the limited personal responsibility granted by hiding behind a corporation, something personal to pierce the corporate veil is needed at this point in time as correction to the rampant abuse from execs

BrandonMarc 7y ago

Yeah, that's a bill that will never see passage.

cabaalis 7y ago

I was initially sceptical, because lying is generally not illegal. CEOs are people, and people have first amendment rights. However, it seems it's narrowly classifying the act of hiding what you do with personal data as criminal fraud, and I'm on board with that idea.

dang 7y ago

Bill proposals rarely count as on topic for HN. Most bills never go anywhere.

disgruntledphd2 7y ago
The content of this bill seems like it would be pretty important for HN, though.
- deleted 7y ago
  [deleted]

deleted 7y ago

[deleted]

ficklepickle 7y ago

What's with the title? I thought Jailtime might be a new apple product. It should be "jail time".